Bill forcing schools to share property taxes with charters passes. But 40% of senators voted no

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21-02-2025

A controversial bill forcing traditional public schools to share property tax revenue with charter schools passed the Senate Thursday, splitting the chamber's Republicans after hours of contentious debate.
Senate Bill 518 passed the Senate by a 28-21 vote, with 12 Republicans joining nine Democrats to vote against it over concerns that it would dilute funding for traditional public schools. The bill will now move to the House in the second half of the legislative session where it will face another round of committee hearings, amendments and votes.
The somewhat narrow vote margin signals it could face an uphill battle on its way to becoming law. The Senate passed the bill on Thursday after nearly two hours of discussion that sometimes was tense.
Opponents of the bill have raised alarms that public school districts across the state will be harmed by the bill, some to the tune of millions of dollars. Indianapolis Public Schools, for example, has said that it could be forced to close 20 schools and lay off staff. A fiscal analysis of the legislation predicts public schools could have to divert $10.4 million to charter schools in 2028.
Sen. Fady Qaddoura, D-Indianapolis, said Republicans in the Senate have "drilled into our minds" recently that lawmakers need to be fiscally responsible due to a tight budget year.
"If this body is truly about choice, then why (does) choice have to come at the expense of the choice of a million people going to traditional schools? Can choice only be accepted if it's at the expense of somebody else?" Qaddoura said.
But the bill has been supported by many Indiana charter schools and school choice proponents who argue that parents who send their kids to charter schools deserve to benefit from their property tax dollars.
The bill's author, Sen. Linda Rogers, R-Granger, said public tax dollars "should be following the child" regardless of whether they go to traditional public or charter schools. It's the same principle Republican leaders have preached when it comes to how to divvy state dollars for education, too.
"We need to also think about the parents that are choosing to send their child to a different school, to a charter school," Rogers said. "Those tax dollars, for years, have not followed their children. Today we need to make that change."
Sen. Chris Garten, R-Charlestown, added that districts like IPS shouldn't retain 100% of property tax revenue when so many kids who live in the district are choosing to attend charter schools instead.
"When we talk about equity in education funding, ask yourself this, 'Is that equitable?'" Garton said. "Why do those kids matter less in the education system? Why should we fund those kids less? Because that's the system currently."
Democrats in the Senate, who have just 10 seats out of 40, tried to change the bill earlier this week but all of their 18 proposed amendments failed to pass muster with Republicans. The only amendment that was approved this week was a Republican proposal to delay the bill's implementation until 2028.
Still, the vote on the bill Thursday split Republicans, too.
Sen. Mike Bohacek, R-Michiana Shores, said charter schools that don't provide bus service shouldn't get property tax dollars, which are supposed to, in part, fund transportation. That money should be returned to taxpayers instead, he said.
"If they're not providing the service, they don't have the liability," Bohacek said. "Why are we giving them 100% of the levy if we know that half of that is for bus service?"
Sen. Jean Leising, R-Oldenburg, had a different reason for opposing the bill: the one charter school in her district isn't included. The bill only applies to districts that sends 100 or more kids to charter schools.
"They really don't understand why they can't be included because their students come from seven different public school (districts)," Leising said. "They cannot participate in this program."
There's a philosophical difference at play in the debate. While opponents said public school districts would lose money, supporters said those districts shouldn't be getting that revenue in the first place.
Sen. Shelli Yoder, D-Bloomington, said on Thursday that she was opposed to the bill because it dilutes public education funding, and public schools educate the vast majority of Indiana kids.
Yoder said the state should fund charter schools in their "own right, without raiding the public property tax dollars."
Rogers, on the other hand, said those traditional public schools are "receiving money for students they are not educating."
Senate President Pro Tempore Rodric Bray said he wasn't surprised to see that several members of his caucus voted against the proposal.
There's a lot of uncertainty right now about property taxes given the tax relief measures in Senate Bill 1, which would also impact schools, he said.
"It's a contentious issue, so I didn't expect it to be 100% at all," Bray said. "We just have to make sure that what we do there is good policy but that does bring some trepidation to some of the members I think."
Contact IndyStar state government and politics reporter Brittany Carloni at [e-mail]. Follow her on Twitter/X @CarloniBrittany.
Contact senior government accountability reporter Hayleigh Colombo at [e-mail]. Follow her on Twitter/X @hayleighcolombo.
This article originally appeared on Indianapolis Star: Bill to share property tax money with charters passes Senate